Legal Analysis Points to Relationship Between XRP and Ripple
The post Legal Analysis Points to Relationship Between XRP and Ripple appeared on BitcoinEthereumNews.com. A legal document has spotted an economic link between Ripple Labs’ profit and XRP. Despite the landmark court ruling, the XRP security status ruling is now under question. Market analyst and researcher SMQKE has spotlighted a legal commentary pointing to an economic link between XRP and Ripple Labs. The post suggests that XRP holders may have acquired some of Ripple’s anticipated future cash flows by licensing its transaction settlement technology. The Link Between Ripple’s Business Model and XRP The legal commentary, an excerpt from a William & Mary Law Review article (Vol. 66:1531), points to a link between Ripple’s business model and XRP. The excerpt quoted by SMQKE reads, “At the end of the day, XRP purchasers have bought, effectively, a SLICE OF THE FUTURE CASHFLOWS that Ripple would make from the licensing of its transaction settlement system.” Based on the commentary, Ripple funds its activities through XRP distributions in exchange for investment capital and labor. This statement implies XRP could be seen as a security tied to Ripple’s profits, contradicting the 2023 SEC vs Ripple ruling. Image Source: SMQKE on X The judge determined that XRP sales on exchanges did not constitute an investment contract, meaning they did not meet the legal definition of a security. This outcome led to partial regulatory clarity around XRP, implicating how crypto assets are categorized under U.S. securities laws. The excerpt also compares tracking stocks and asset securitizations, stating that such instruments serve effectively the same economic function. However, the document also acknowledges the complexity of categorizing XRP. It noted that Ripple Labs’ business is structured in a way that gives it room to argue against the classification of XRP as a security. The text mentions that Ripple can claim no direct contractual rights between the company and XRP holders. The blockchain payments…
The post Legal Analysis Points to Relationship Between XRP and Ripple appeared on BitcoinEthereumNews.com.
A legal document has spotted an economic link between Ripple Labs’ profit and XRP. Despite the landmark court ruling, the XRP security status ruling is now under question. Market analyst and researcher SMQKE has spotlighted a legal commentary pointing to an economic link between XRP and Ripple Labs. The post suggests that XRP holders may have acquired some of Ripple’s anticipated future cash flows by licensing its transaction settlement technology. The Link Between Ripple’s Business Model and XRP The legal commentary, an excerpt from a William & Mary Law Review article (Vol. 66:1531), points to a link between Ripple’s business model and XRP. The excerpt quoted by SMQKE reads, “At the end of the day, XRP purchasers have bought, effectively, a SLICE OF THE FUTURE CASHFLOWS that Ripple would make from the licensing of its transaction settlement system.” Based on the commentary, Ripple funds its activities through XRP distributions in exchange for investment capital and labor. This statement implies XRP could be seen as a security tied to Ripple’s profits, contradicting the 2023 SEC vs Ripple ruling. Image Source: SMQKE on X The judge determined that XRP sales on exchanges did not constitute an investment contract, meaning they did not meet the legal definition of a security. This outcome led to partial regulatory clarity around XRP, implicating how crypto assets are categorized under U.S. securities laws. The excerpt also compares tracking stocks and asset securitizations, stating that such instruments serve effectively the same economic function. However, the document also acknowledges the complexity of categorizing XRP. It noted that Ripple Labs’ business is structured in a way that gives it room to argue against the classification of XRP as a security. The text mentions that Ripple can claim no direct contractual rights between the company and XRP holders. The blockchain payments…
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